The shares of winemaker Sula Vineyards made a decent debut on the stock exchanges NSE and BSE on Thursday i.e. December 22. On BSE, Sula Vineyards listed at Rs 358 apiece against the issue price of Rs 340-357. The stock started its trading journey at Rs 361 apiece on NSE — a 1.1 percent premium to the issue price.
Indian winemaker's Rs 960 crore Initial Public Offer (IPO) opened for subscription for retail investors on December 12 and the issue concluded on December 14. The price band of the issue was fixed at Rs 340-357 per share.
The Rs 960.35 crore IPO received bids for 4,38,36,912 shares against 1,88,30,372 shares on offer, according to exchange data. The initial public offer got subscribed 2.33 times on the last day of the offer.
The category for Qualified Institutional Buyers (QIBs) got subscribed 4.13 times, the Retail Individual Investors (RIIs) portion received 1.65 times subscription and non-institutional investors 1.51 times.
Sula Vineyards' IPO was entirely an offer for sale (OFS) where promoters, and other existing investors sold close to 2.7 crore shares. An Offer for Sale or OFS means that Sula Vineyards will not receive any proceeds from the sale of shares.
Kotak Mahindra Capital Company Ltd, CLSA India Private Ltd, and IIFL Securities were the managers of the offer.
In interaction with CNBC-TV18, Rajeev Samant, MD & CEO, Sula Vineyards said that wine category has great prospects in India. “People have been always saying, isn't India really all about whiskey? Yes, whiskey is the king in India and we are not looking to dethrone the king anytime soon. We have a fantastic journey ahead. Wine is growing faster than whiskey, spirits and beer. Sula is a leader in that. India is changing so fast. Wine has terrific prospects here.”
“We are building a 6 million liter capacity, new winery, brownfield at our Dindori site to augment our existing 14 million liter of capacity. So, it's a pretty significant expansion,” Samant added.
Sula Vineyards is synonymous with Indian wines and is considered a ‘category creator’ in the segment. Sula is headquartered in Nashik, 180km northeast of Mumbai, and has two manufacturing units, in Nashik and Bengaluru each. As of January, it had a production capacity of over 13 million litre, of which 11 million litre is housed in Nashik and 2 million litre in Karnataka.
The company distributes wines under a bouquet of popular brands such as Sula (its flagship brand), RASA, Dindori, The Source, Satori, Madera & Dia. Currently, it produces 56 different labels of wines across 13 distinct brands at its four owned and two leased production facilities located in Maharashtra and Karnataka.
According to the company's red herring prospectus (RHP), its market share in the 100 percent grapes wine category, rose from 33 percent in financial year 2009 to 52.6 percent in financial year 2021 in the Indian market.